JAKARTA (Reuters) – Indonesia’s President Joko Widodo announced on Monday that the country may issue a new regulation on the use of social media for selling goods. The move aims to address concerns about the impact of e-commerce sellers using predatory pricing on social media platforms on offline markets. TikTok, a popular video platform, has been specifically mentioned as one of the platforms threatening traditional markets in Indonesia.
President Widodo, also known as Jokowi, stated during a video address that the decision regarding the use of social media for e-commerce has been made, and the regulation may be released on Tuesday. He emphasized the need for technology to create new economic potential instead of harming existing economies.
However, President Widodo did not provide further details about the regulation or mention any specific companies. The formulation of the regulation is being undertaken by the trade ministry, and it is expected to fill the gap in current trade regulations that do not cover direct transactions on social media.
In an earlier statement, Deputy Trade Minister Jerry Sambuaga expressed his intention to ban the combination of social media and social commerce, pointing to TikTok’s “live” features that enable the sale of goods. TikTok, owned by Chinese tech company ByteDance, has declined to comment on the potential regulation.
TikTok is popular in Southeast Asia, with 325 million monthly active users in the region, including 125 million users in Indonesia. The platform’s TikTok Shop is reported to host 2 million small businesses in Indonesia.
The regulation on social media use for e-commerce is expected to provide guidelines and safeguards to ensure fair competition and protect offline markets. By addressing concerns about predatory pricing and unregulated online transactions, the Indonesian government aims to facilitate a healthier business environment for all participants.
The announcement of the regulation has received mixed reactions, with some expressing concerns about the potential impact on small businesses that rely on social media for sales. As the implementation details of the regulation become clearer, it is expected to generate further discussions and debates among stakeholders.
Reporting by Ananda Teresia and Stanley Widianto; Editing by Kanupriya Kapoor and Christian Schmollinger
Credit: The Star : Tech Feed
